CHICAGO — Chicago faces a more modest gap in its 2014 budget of $339 million before its financial reckoning arrives the following year when public safety pension payments will spike by $600 million, according to the city's new annual financial analysis that kicks off its official budget season.

The gap will grow to $995 million ahead of the 2015 budget and then $1.16 billion in two years absent action by Illinois to reform local government pensions and ease the city's dramatic payment spike or formation of a city backup plan.

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